AIR India is making new product and distribution moves as part of a US$360 million financial restructuring plan, which will see it adding more economy-class seats and appointing GSAs in 56 countries.

The five-year GSA contracts are meant to garner new markets, as the airline is poised to launch several international routes from New Delhi and Mumbai this year, especially with the entry of its first 787 Dreamliner into service in summer.

Due to low demand for business-class seats, Air India is also reconfiguring 62 Airbus A320s in its fleet, leaving 14 with all-economy seats, while 43 will see the number of business-class seats reduced.

Anil Punjabi, chairman-east, Travel Agents Federation of India, said: “Air India is now looking realistically at its bottom line. More economy seats will help hugely in increasing domestic market share, and given its large network in the country will keep fares low. GSAs are the way to go for international markets.”

In the wake of the economic slowdown in 2008-2009, Air India shut down several of its overseas offices to cut down on operational costs. There are currently 10 overseas offices owned and staffed by the airline.

ACCOR’S launch of its Formule 1 brand in India is seen as a breath of fresh air by travel consultants, who lament the lack of branded rooms in lower-tier categories. The first Formule 1 hotel opened its doors in Greater Noida on April 4, while 10 more properties are expected to be launched by 2013.

According to Philip Logan, vice president Formule 1 Hotels, India, Formule 1 will be the first international budget hotel brand in India with a price of around Rs2,000 (US$40) per person.

Based on the concept of standard rooms with a single price for up to three people, Formule 1 hotels target domestic corporate travellers looking for low room tariffs and quality service standards. They are well known in Europe.

Rajat Sawhney, managing director, Rave Tours & Travel, said: “Such hotels fulfill a much-awaited need. There is a large concentration of travellers who look for clean comfort at budget prices with some standardised facilities. Formule 1 hotels should be able to cater to this requirement.”

Susrita Banerjee, managing director, Fly Faraway, said: “A low-cost hotel offering standardised quality under the Accor umbrella brand will plug a much-needed gap in India’s hotel development. While most branded rooms are in the luxury or five-star categories, development in the budget category is unorganised and sporadic. Formule 1 will be a popular option for many business travellers.”

Located in the business hub of Greater Noida, the new Formule 1 hotel features 114 soundproof rooms with amenities such as a flatscreen TV, Wi-Fi, quality bedding with duvets, attached bathroom, individually-controlled air-conditioning and a work table.

WESTMINSTER Travel has acquired a 100 per cent interest in Travelex Hong Kong, following the completion of a HK$79 million (US$10 million) deal on March 31. The buyout covers only the travel service arm, and Travelex will be rebranded in the next three months.

Diversifying the group’s business strategies was the rationale behind the acquisition, according to Larry Lo, managing director, Westminster Travel. “Currently, our joint venture with HRG serves global corporate (travellers), while Westminster targets the local and regional corporate (sectors). In fact, local SMEs also require (personalised services) and we want to tap into this market.”

There will be no major changes to Travelex’s existing management team, said Lo, with Eliza Ma continuing to head the 85-staff company as general manager for corporate and leisure travel.

Ma said: “In the past, Travelex’s core business was money exchange, and travel services had limited support. Our strategy (now) is to explore SMEs’ needs and deliver tailor-made outbound products with a personal touch.” To fuel growth, 10 more staff will be recruited within a year and a new website with more interactive functions, such as instant online confirmation, will be launched.

Added Lo: “We are open to any joint ventures or acquisitions for generic growth. Our mission is to maintain our market position, and diversification is the way to go because of fierce competition nowadays.”

MALAYSIA anticipates that its hosting of the annual PATA conference in Kuala Lumpur from April 19-22 will attract more events into the country.

Malaysia’s tourism minister and PATA conference chairman, Ng Yen Yen, said: “Hosting the event will enable us to highlight that tourism is taken very seriously in Malaysia with the full support of the prime minister and cabinet.”

“For example, when (the PATA conference) was held in Malaysia in 2001, we did not have a dedicated tourism ministry as at present. It was combined with arts and culture.”

According to Azizan Noordin, acting director general of Tourism Malaysia, Malaysia’s experience of hosting PATA conferences have boosted the country’s reputation for MICE. Malaysia held PATA conferences in 1972, 1986 and 2001.

Since then, the country has also built a slew of dedicated convention centres including the Kuala Lumpur Convention Centre, Genting International Convention Centre and Borneo Convention Centre Kuching, he added.

Themed Building the Business Beyond Profits, this year’s PATA conference has registered 461 delegates from 14 countries.

Tunku Iskandar, PATA’s programme committee chairman said: “There are two key aspects to the conference content this year. One involves young people – young tourism business professionals and students (at local colleges offering tourism courses) – through various sessions and the Social Entrepreneurial Challenge, and the other looks at how to build the business beyond the objective of achieving profits.”

Reporting by N. Nithiyananthan